Last week, investors seemed to be in the holiday spirit ahead of the
Memorial Day weekend, as some temperate economic news, lower oil prices and a
smattering of positive tech reports helped provide the Nasdaq with a much
needed boost. "We got some good news about the economy, earnings news
continues to be good and oil has fallen back," commented Edgar Peters, chief
investment officer at PanAgora Asset Management Inc, to Reuters News. "There
is a lot of good news out there and optimism is picking up after quite a few
weeks of pessimism here." The revised first-quarter GDP figure strengthened
from the prior reading, although the pace of expansion was just shy of
forecasts, which seemed to ease concerns regarding a potentially sharp
increase in interest rates. Also, oil prices fell beneath $40 a barrel, on
word OPEC is considering a large increase in its production ceiling. Brian
Pears, head stock trader at Victory Capital Management, commented to The Wall
Street Journal, "Oil has been down for most of this (last) week, and stocks
have been inversely correlated with oil going back at least for two weeks."
Meanwhile, Energy Secretary Spencer Abraham said the U.S. sees signs of extra
oil supplies from Mexico, Nigeria, Russia and Saudi Arabia. In corporate
reports, Computer Associates and Tech Data rallied on their quarterly
earnings, which beat analyst forecasts. Lucent also witnessed impressive
gains, after Cingular Wireless said it would use its technology for a high-
speed wireless Internet network. Also, Novellus Systems attracted buyers,
after the firm boosted its earnings and revenue targets for the second
quarter, citing strength in Japan, Korea and the U.S. In this shortened-
trading week, earnings reports will slow to a crawl, and May's employment
report is sure to keep the market on its toes ahead of its Friday release.
High-Tech Monday Update is provided courtesy of Thomson Financial. This
information is believed to be true and accurate; we take no responsibility for
inaccurate information and reserve the right to update our reports. For more
information, please visit our web site at http://www.thomson.com/financial.
SOURCE Thomson Financial Corporate Group
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